The company loans component makes it possible to enter and administer company loans in the R/3 system as well as perform payroll accounting for them.

You can grant an employee company loans for a specific purpose, for example, to build a house or buy a car. This means that the employee is granted an interest rate lower than the market’s usual reference interest rate. The employee’s salary provides your enterprise with security.

The amount of administration is kept low as the processing of formalities, payment of the loan, and repayment and interest payment by the employee can simply be processed using Payroll Accounting.

In principle, it is possible to choose between installment loans and annuity loans in the R/3 system, that differ in their methods of repayment. Further distinguishment is made between various types of loan to simplify the awarding of the loan, which is purpose-related, and the evaluation of the loan. You can set up loan types and their conditions in Customizing. This also applies for conditions that affect payment of the loan amount to the employee.

In Master Data, company loans data is processed in the Loans (0045) and Loan Payments (0078) infotypes. The various authorizations that are linked with master data maintenance and payments administration, make the use of two infotypes necessary.

• You enter the master data for employer loans in the Loans infotype (0045). You can display information on loan conditions, transactions and status here.
• In the Loan Payments (0078) infotype, make entries for payment of the loan amount to the employee and special repayment by the employee.

Loan repayment and interest calculation are automatically processed in payroll accounting and, according to your entries, retained from the employee’s salary. The loan calculation data is saved along with the payroll results.